The maker of Jack Daniels feels the sting of US commercial disputes and retaliatory tariffs on American whiskeys.
whose brands include Old Forester and Woodford's Reserve Bourbon, warned that profits for the current fiscal year would miss the earlier forecasts due to uncertainty costs recently in force European Customs Discharges
The European Union began levying 25% duty on US whiskeys, Harley motorcycles and other goods in June after President Trump took over the steel and aluminum imports from the Union. In July,
Cut its earnings forecast and said it would shift production overseas to avoid EU tariffs, which would cause Mr. Trump's anger.
Brown Forman executives said Wednesday they would delay price increases in some EU markets to minimize the impact on their products. "In a way, we're buying time to see if these things can be fixed," said the chief executive
The executives said the delayed price increases, coupled with increased costs and exchange rate fluctuations, could lose 1
The threat of tariffs has fueled business in Louisville, Kentucky, in its first quarter ending July 31st, which led to an increase in sales in Europe. Revenue rose 6% to $ 766 million, as strong growth was posted international markets could offset sales in the US. Executives said half of the 12% sales increase in developed markets overseas markets were the result of purchases to build inventories before duty. Quarterly earnings increased 12% to $ 200 million, or 41 cents a share.
Brown Forman's Class B stock changed little in trading on Wednesday, rising 9 cents to $ 52.41. The stock climbed about 25% last year.
On Wednesday, French spirits rival Pernod Ricard SA said price conditions improved in the just-completed fiscal year, but warned that it uses higher commodity prices for agave in tequila and grapes in cognac. Jameson Irish Whiskey and Absolut Wodka said that earnings for the year ended June 30 increased 13% to $ 1.58 billion ($ 1.85 billion) on flat sales of $ 8.99 billion is. Excluding currency effects, sales increased by 6% compared to the previous year, the company said.
Write to Jennifer Maloney at [email protected]